EMPLOYERS are providing anonymous tip-offs about social welfare fraud after being undercut on contracts by rogue firms.

There are growing concerns about companies in the 'black economy' winning contracts by paying lower wages to people who are topping up their income with social welfare payments.

According to new figures, there was a total of 12,648 anonymous tip-offs about social welfare fraud last year, which was more than the previous five years combined.

Fine Gael TD David Stanton said some of the reports were coming from employers angry about the impact of social welfare fraud on their business.

"The employers were concerned about being undercut by people working in the black market," he said. "These would be legitimate guys who would pay their workers properly and make their returns."

The Cork East TD said that in one case, a "furious" employer had tipped off the Department of Social Protection because he was undercut on a building contract by a company that appeared to be employing people who were claiming social welfare.

The number of tip-offs provided last year was almost double the figure of 6,429 tip-offs in 2009, which itself was way up on 1,044 tip-offs in 2008.

Mr Stanton said it was a sign of the times that there was no longer a stigma about informing on social welfare fraudsters. "People are hurting and if they think somebody is taking a job that they think their son or daughter should have, the anger is there, and they will report it," he said.

The Department of Social Protection said almost 9,800 of the tip-offs last year were passed on to the relevant area to be examined by an inspector.

But around 2,900 tip-offs could not be pursued because there was not enough information or no social welfare claim was being made.

Investigation

The department said a full investigation had to be carried out -- and the case file was then passed on to a deciding officer given no information about the original anonymous tip-off.

Mr Stanton said the process was important, as there was a danger of vexatious complaints.

He said he had come across a case of a man who had signed off the dole to do a few days' work and when he went to sign back on, he was told there had been complaints about him.

Social Protection Minister Joan Burton said the "vast majority" of the one million people who received a social welfare payment every week were receiving the entitlement that was due to them.